For the data behind the commentary, download the full April 2026 UK Economy & Housing Report.
crossroads
On 8th April, a two week ceasefire to the war in Iran was announced, with the US stating that Iran’s proposal was a “workable basis on which to negotiate”. Despite the ceasefire, strikes in Lebanon continued, and the Strait of Hormuz was still suspended.
Energy markets had responded positively on the announcement of the ceasefire Brent fell 13-15% on 8th April to around $95 on ceasefire news, down from $112 earlier in the week. UK natural gas (NBP) fell 15% to 114p/therm on 8th April. The following day, UK NBP gas closed at 112.47p/therm on 9th April, down a further 1.56% on the day. The two-day move represented a decline of roughly 17% from the ~134p range seen in the days before the ceasefire. Despite the drop, NBP remained around 36% above year-ago levels, reflecting how much the conflict has structurally repriced European gas. Intraday on 9th April, futures briefly recovered toward 118p as Israeli strikes on Lebanon raised doubts about whether the ceasefire would hold, before settling back to close lower, a pattern that captures the volatility of the market.
Gold closed at $4,776/oz on 9th April, up 0.95% on the day and extending three straight sessions of recovery after the ceasefire driven by dollar weakness as safe-haven demand unwound rather than any genuine repricing of risk. Nevertheless. Gold was still down roughly 9–10% from its pre-conflict peak above $5,100.
The ceasefire on 8th April produced the sharpest single-day unwind of VIX: the index dropped over 5.8 points to 20.13, its lowest level since 27th February and the largest one-day fall since the US paused his tariff rollout a year ago. It fell again on 9th April to close at 19.49, down a further 7.37%, before edging back to around 20.2 on the morning of 10th April. The move effectively erased the entire conflict premium that had built up over six weeks.
However, at the time of writing, the positives of the potential ceasefire have now been eroded. The US announced there was no peace deal with Iran after talks in Pakistan, with the response being the announcement of a naval blockade of the Strait of Hormuz, potentially seizing vessels paying tolls to Iran. While initially, markets responded well, oil prices increased. There will be uncertainty and an increase in energy prices and risk up until a resolution is found.
